Malawi grain marketing system under microscope

African Institute of Corporate Citizenship (AICC) Wednesday organised a debate in Lilongwe where panellists representing the country’s agriculture sector scrutinised the current status and projected the future of the country’s grain market.

Lombe speaking before the debate
Namaona speaking during the debate

AICC Chief Executive Officer Felix Lombe said the debate, which was attempting to answer the question “Should Malawi extend the Auction System and Export Mandates to grain marketing?”, was inspired by threats the current grain marketing landscape is posing to farmers’ livelihoods and the economy at large.

“We have advised farmers to produce more, and we have encouraged them to operate in cooperatives, but we still see them crying foul after selling off their produce. That’s an indication that something is not in order in the grain marketing system,” Lombe said.

He cited this year’s scenario where farmers have cried foul after the grain market, which encompasses legumes, cereals, and oilseeds, had suffered a severe drop in prices.

He attributed the problem to inconsistent pricing and lack of proper grain marketing structures.

“The future of grain marketing has a critical bearing on the country’s farmers and Growth Domestic Product (GDP) and price fluctuations are greatly hampering economic growth in the country,” he explained.

He disclosed that cotton was still number four amongst the country’s foreign exchange earners above grain despite the recent successive drops in production against grain harvests whose production has been on the increase.

This, according to Lombe, was an indication that the grain market system lacked a well regulated structure and monitoring strategy saying the sharp contrast in cotton decrease against grain increase should have put grain on a higher position than cotton as a foreign currency fetcher.

The panellists included representation from the Ministry of Agriculture, Irrigation and Water Development, Ministry of Industry, Trade and Tourism, AHL Commodities and Agriculture Commodity Exchange.

During the debate, Alexy Namawona from the Agriculture Ministry cautioned that as the stakeholders pushed for export markets for grain produce, they should also balance the focus with production saying once in order, the export market would need a constant supply of the grain produce.

He said by 2050, Africa was projected to be in a state of producing less grain and food produce than the demand for the then population and thus the need to ensure that the country’s grain produce should be able to match up.

The panellists have since agreed that there is a need for the country to have a properly established grain marketing structure which should, among others, include a properly managed Warehouse Receipt System.

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